What will a Labour Goverment do to my pocket come April 2018 Tax Cuts?

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#1845088 11-Aug-2017 12:03

DaveB:

We certainly have a high Tax to GDP Ratio (I think still the highest). When tax revenues grow at a slower rate than the GDP of a country, the tax-to-GDP ratio drops; when tax revenue grows faster than GDP, the ratio increases. With NZ at the top or constantly in the top 8, it indicates that we have healthy tax growth. Well to me it does, but I am probably wrong lol.

http://www.theglobaleconomy.com/rankings/Tax_revenue/

I think a problem with that tax:GDP comparison is that in NZ, healthcare (exception ACC), superannuation, unemployment benefits, are directly funded from consolidated revenue in NZ.

In many countries (comparable social democracies) funding for these may be just as inescapable, but paid for partly or fully by levies taken separately from "income tax".

Wiggum

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#1845106 11-Aug-2017 12:31

tdgeek:

NZ has a fully funded health system and a wide ranging social support system, it would be interesting to know if the lower tax nations fund as much as we do. Also what effect our small size has on our economies of scale.

Thats true, Are you saying we funding a lot? Interesting that you bring this up. There are other lower taxed nations, who have a far better health, and social support systems in place than we do. Many people (including right here) will argue that our services are not nearly up to scratch. Its therefore interesting that most of the left seem to think that its only possible to fix it with more tax. Thats not the case.

Fred99:

I think a problem with that tax:GDP comparison is that in NZ, healthcare (exception ACC), superannuation, unemployment benefits, are directly funded from consolidated revenue in NZ.

In many countries (comparable social democracies) funding for these may be just as inescapable, but paid for partly or fully by levies taken separately from "income tax".

Yes and we all know that we have such a great healthcare/unemployment benefits system, already covered by our taxes. Yet why are we pushing for more?

DaveB

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#1845111 11-Aug-2017 12:34

Fred99:

DaveB:

We certainly have a high Tax to GDP Ratio (I think still the highest). When tax revenues grow at a slower rate than the GDP of a country, the tax-to-GDP ratio drops; when tax revenue grows faster than GDP, the ratio increases. With NZ at the top or constantly in the top 8, it indicates that we have healthy tax growth. Well to me it does, but I am probably wrong lol.

http://www.theglobaleconomy.com/rankings/Tax_revenue/

I think a problem with that tax:GDP comparison is that in NZ, healthcare (exception ACC), superannuation, unemployment benefits, are directly funded from consolidated revenue in NZ.

In many countries (comparable social democracies) funding for these may be just as inescapable, but paid for partly or fully by levies taken separately from "income tax".

Any comparison is a potential minefield and provides a subjective but overall view. With regards to health care, out of those 190 countries NZ stays at the upper end of the rankings. Health spending per capita = 14, Health spending as % GDP =13 and importantly Life Expectancy = 20th ranking (81.40 years) - above the USA.

Another thing that struck me from those global economy com figures was the Number of Taxes by Country. NZ apparently only has 8 compared to Venezuela's 70.

With a reasonably simple, but healthy tax structure, good health spending and a life expectancy at the top end, we are doing ok.

Geektastic

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#1845127 11-Aug-2017 12:42

Fred99:

DaveB:

We certainly have a high Tax to GDP Ratio (I think still the highest). When tax revenues grow at a slower rate than the GDP of a country, the tax-to-GDP ratio drops; when tax revenue grows faster than GDP, the ratio increases. With NZ at the top or constantly in the top 8, it indicates that we have healthy tax growth. Well to me it does, but I am probably wrong lol.

http://www.theglobaleconomy.com/rankings/Tax_revenue/

I think a problem with that tax:GDP comparison is that in NZ, healthcare (exception ACC), superannuation, unemployment benefits, are directly funded from consolidated revenue in NZ.

In many countries (comparable social democracies) funding for these may be just as inescapable, but paid for partly or fully by levies taken separately from "income tax".

This is true. Also in many comparable social democracies, money you save in a pension fund for retirement is tax free. In NZ it isn't.

tdgeek

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#1845129 11-Aug-2017 12:49

Wiggum:

tdgeek:

NZ has a fully funded health system and a wide ranging social support system, it would be interesting to know if the lower tax nations fund as much as we do. Also what effect our small size has on our economies of scale.

Thats true, Are you saying we funding a lot? Interesting that you bring this up. There are other lower taxed nations, who have a far better health, and social support systems in place than we do. Many people (including right here) will argue that our services are not nearly up to scratch. Its therefore interesting that most of the left seem to think that its only possible to fix it with more tax. Thats not the case.

Fred99:

I think a problem with that tax:GDP comparison is that in NZ, healthcare (exception ACC), superannuation, unemployment benefits, are directly funded from consolidated revenue in NZ.

In many countries (comparable social democracies) funding for these may be just as inescapable, but paid for partly or fully by levies taken separately from "income tax".

Yes and we all know that we have such a great healthcare/unemployment benefits system, already covered by our taxes. Yet why are we pushing for more?

I never said we are funding a lot, stop making things up.As per a post above you will see that we are doing well with our healthcare system. Yet, it is underfunded, so if we can fix that without more money how do we do that? As with all of your posts you spout about this and that, yet you do not back it up with reasoning, and you bypass others reasoning by "I dont buy it" as one of many examples. "The Govt should be able to do it without more taxes and so on, tell us how

Wiggum

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#1845130 11-Aug-2017 12:49

Geektastic:

This is true. Also in many comparable social democracies, money you save in a pension fund for retirement is tax free. In NZ it isn't.

This is actually a big one, I see this on my payslip every month. Employer superannuation contribution tax (ESCT). It a lot every month, over and above my PAYE. I guess I will also be taxed on my kiwisaver when I get to retirement too.

Wiggum

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#1845136 11-Aug-2017 12:59

tdgeek:

I never said we are funding a lot, stop making things up.As per a post above you will see that we are doing well with our healthcare system. Yet, it is underfunded, so if we can fix that without more money how do we do that? As with all of your posts you spout about this and that, yet you do not back it up with reasoning, and you bypass others reasoning by "I dont buy it" as one of many examples. "The Govt should be able to do it without more taxes and so on, tell us how

You said we are funding more than other countries. I found this interesting, especially because other countries are doing better than us on less funding/taxes.

How can we fix it without more money? I said it can be "fixed" without increasing taxes. That can be done by stopping other unnecessary spending, boosting the economy etc etc.. Plenty of ways actually. Increasing taxes is just the easy way out for the government to make some quick money, without putting some real effort and thought into it.

Besides. IMO our health and social benefit systems are not broken. As per your post above, I think you may agree? So If it was me I would not be fixing it. Our taxes are already heavily funding these social services, thats not a bad thing really. But to increase taxes to fix something that not really broken (possibly just needing some tweaking), come on!

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tdgeek

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#1845160 11-Aug-2017 13:27

Ill talk to my MP and get her to suggest that they drop all unnecessary spending, and while they are at it, boost the economy 10%, all of that will be easy, and pay for your tax cuts. Oh, and etc, etc, they can do that too, again, easy

Wiggum

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#1845178 11-Aug-2017 13:48

tdgeek:

Ill talk to my MP and get her to suggest that they drop all unnecessary spending, and while they are at it, boost the economy 10%, all of that will be easy, and pay for your tax cuts. Oh, and etc, etc, they can do that too, again, easy

Make sure you talk to the right MP. Otherwise you may just get blank stares.

National seemed to have been able to do it.

tdgeek

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#1845196 11-Aug-2017 14:02

Wiggum:

tdgeek:

Ill talk to my MP and get her to suggest that they drop all unnecessary spending, and while they are at it, boost the economy 10%, all of that will be easy, and pay for your tax cuts. Oh, and etc, etc, they can do that too, again, easy

Make sure you talk to the right MP. Otherwise you may just get blank stares.

National seemed to have been able to do it.

I dont buy it

Yes National is giving you tax cuts, they seem to be able to do it. Labour might take them away. Your vote has been bought, success

Wiggum

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#1845200 11-Aug-2017 14:05

tdgeek:

Wiggum:

tdgeek:

Ill talk to my MP and get her to suggest that they drop all unnecessary spending, and while they are at it, boost the economy 10%, all of that will be easy, and pay for your tax cuts. Oh, and etc, etc, they can do that too, again, easy

Make sure you talk to the right MP. Otherwise you may just get blank stares.

National seemed to have been able to do it.

I dont buy it

Yes National is giving you tax cuts, they seem to be able to do it. Labour might take them away. Your vote has been bought, success

Not voting national. They too far to the left.

6FIEND

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#1845205 11-Aug-2017 14:12

tdgeek:

Yes National is giving you tax cuts, they seem to be able to do it. Labour might take them away. Your vote has been bought, success

It's a bit of a stretch to insinuate that taking slightly less out of a person's paycheque every month is equivalent to buying them off.

My view on this is that if a Government is running a surplus (which we presently are) then all that means is that the government is taxing its populace more than is needed to meet its currently committed expenses.

There are three things that you can do with the surplus...

1) Return it to the people who earned it in the first place via tax cuts

2) Increase spending on new initiatives

3) Pay down debt

In my ideal world, the discussion would be around what percentage of the surplus would be allocated to each of the three activities - not an ideological debate where it must all go into one option or another...

tdgeek

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#1845222 11-Aug-2017 14:28

6FIEND:

tdgeek:

Yes National is giving you tax cuts, they seem to be able to do it. Labour might take them away. Your vote has been bought, success

It's a bit of a stretch to insinuate that taking slightly less out of a person's paycheque every month is equivalent to buying them off.

My view on this is that if a Government is running a surplus (which we presently are) then all that means is that the government is taxing its populace more than is needed to meet its currently committed expenses.

There are three things that you can do with the surplus...

1) Return it to the people who earned it in the first place via tax cuts

2) Increase spending on new initiatives

3) Pay down debt

In my ideal world, the discussion would be around what percentage of the surplus would be allocated to each of the three activities - not an ideological debate where it must all go into one option or another...

My comment was aimed at the OP.

Also add 4) retaining reserves for planned future expenditure

In an ideal world we would pay down debt, like we would at home, and pay for new initiatives. Tax cuts are fine if they can be part of an annual distribution of wealth once all other bases are covered, and if surpluses are all or at least most years. As regards the current surplus, with the health board under pressure, nothing has been done in past years at all, or of any significance for the water pollution, housing issues, traffic congestion, how much surplus are we having due to putting these things aside? I could increase my surplus by flagging maintenance and repairs, and then say we are doing well, then start giving it away, only then to be caught having to invest a lot to catch up past years. Not very responsible IMHO

Wiggum

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#1845231 11-Aug-2017 14:43

tdgeek:

[As regards the current surplus, with the health board under pressure, nothing has been done in past years at all, or of any significance for the water pollution, housing issues, traffic congestion, how much surplus are we having due to putting these things aside? I could increase my surplus by flagging maintenance and repairs, and then say we are doing well, then start giving it away, only then to be caught having to invest a lot to catch up past years. Not very responsible IMHO

Quiet frankly, I have seen the most/best use of my tax money over the last few years, New expressways, new trains in Wellington, new double tracking all the way to Waikanae. Sure most of this is infrastructure. But thats not necessarily a bad thing. I would much rather see the money being spent on infrastructure as it creates more jobs in the process. I don't get where you coming from with this that a new government needs to "catch up". I recall a Labour campaign to stop the kapit Expressway & Transmission Gully construction projects.

Bad rivers etc are caused by bad farming practices. This can be solved by changing legislation, and making farmers more accountable etc.. I don't really blame the government much for that except for maybe not taking a hard enough stance against it. The first thing to do before "fixing it", and throwing more taxpayer money at it, would be to stop it from getting worse. This does not require changes to tax.

6FIEND

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#1845240 11-Aug-2017 14:51

tdgeek:

My comment was aimed at the OP.

Also add 4) retaining reserves for planned future expenditure

In an ideal world we would pay down debt, like we would at home, and pay for new initiatives. Tax cuts are fine if they can be part of an annual distribution of wealth once all other bases are covered, and if surpluses are all or at least most years. As regards the current surplus, with the health board under pressure, nothing has been done in past years at all, or of any significance for the water pollution, housing issues, traffic congestion, how much surplus are we having due to putting these things aside? I could increase my surplus by flagging maintenance and repairs, and then say we are doing well, then start giving it away, only then to be caught having to invest a lot to catch up past years. Not very responsible IMHO

Again - this is simply not true.

2008 National Health budget was $11.92 billion per annum By 2017 it has increased to $16.77 billion. (a 40.7% uplift)

And to claim nothing of significance in the other areas you mention is also spurious.

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